Bangladesh Bans Polythene Bags Again, Sparking Hopes for the Eco-Friendly ‘Sonali Bag’

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Environment

Female workers sort out plastic bottles for recycling in a factory in Dhaka, Bangladesh. Credit: Abir Abdullah/Climate Visuals Countdown

Female workers sort out plastic bottles for recycling in a factory in Dhaka, Bangladesh. Credit: Abir Abdullah/Climate Visuals Countdown

DHAKA, Nov 27 2024 (IPS) – After Bangladesh’s interim government banned polyethene bags, a new sense of hope has emerged for the Sonali bag—a jute-based, eco-friendly alternative developed in 2017 by Bangladeshi scientist Dr. Mubarak Ahmed Khan. Sonali bag, or the golden bag, is named after the golden fiber of jute from which it is made.


Despite its promises, the project has struggled to make significant progress due to a lack of funding. However, following the announcement of the polythene bag ban, Mubarak is now facing pressure to supply his Sonali bag to a market eager for sustainable alternatives.

“Since the government banned polythene bags, we have faced immense pressure of orders that we cannot meet—people are coming in with requests at an overwhelming rate,” Mubarak Ahmed Khan told the IPS.

The latest ban, which came into effect on October 1 for superstores and traditional markets on November 1, isn’t the first time Bangladesh has imposed a ban on polythene bags.

In 2002, the country became the first in the world to outlaw them, as plastic waste was severely clogging city drainage systems and exacerbating its waterlogging crisis, with Dhaka alone consuming an estimated 410 million polybags each month. But the ban gradually lost effectiveness over the years, largely due to a lack of affordable and practical alternatives and inadequate enforcement from regulatory authorities.

Dr. Mubarak Ahmed Khan in his office holding a Sonali Bag. Credit: Masum Billah/IPS

Dr. Mubarak Ahmed Khan in his office holding a Sonali Bag. Credit: Masum Billah/IPS

Polyethene bags, although cheaper, are harmful to the environment as they are non-biodegradable and their decomposition takes at least 400 years. Sonali Bag as an alternative, on the other hand, is regarded as a game-changer because it is biodegradable, capable of decomposing in three months.

The ban comes as the UN Plastics Treaty Negotiations are underway in Busan, South Korea. The UN Environment Programme estimates that around the world, one million plastic bottles are purchased every minute.

“In total, half of all plastic produced is designed for single-use purposes—used just once and then thrown away.”

Without an agreement, the OECD estimates that annual plastic production, use, and waste are predicted to increase by 70 percent in 2040 compared to 2020. This on a planet already choking on plastic waste.

The talks have in the past stalled over a disagreement over how to manage waste, with some countries favouring introducing a cap on plastic production and others supporting circularity with use, reuse, and recycling as the main objectives.

The plastics treaty talks will run from 25 November 2024 to 1 December 2024.

However, despite its environmental benefits and higher demands, in Bangladesh the Sonali Bag project still remains within the pilot phase.

A late start for funding crisis

After Mubarak’s invention made headlines, the country’s state-owned Bangladesh Jute Mills Corporation launched a pilot project, setting up a jute-polymer unit at the Latif Bawani Jute Mill to produce Sonali Bag.

Mubarak said they have been asking for government funds, as the project has been operating under the Ministry of Textiles and Jute. However, the basic funding that kept the pilot project running expired last December, and the previous government—which was toppled in August in a mass uprising—had discontinued the project.

“There had been assurances that we might receive Tk100 crore (about USD 8 million) in funding from the government by July. But then came political unrest and a change in government,” Mubarak said.

After the new government took charge, they renewed the pledges to fund the Sonali Bag project.

“The interim government told us that we will get the money in January. If that happens, we will be able to produce five tons of bags per day,” Mubarak said. “Five tons may not be a lot, but it will give us the chance to demonstrate our work to private investors, boosting their confidence to engage with us.”

According to Mubarak, one kilogram of Sonali bags amounts to around 100 pieces of small bags. Based on this estimate, five tons could produce around 15 million bags per month.

Bangladesh’s current adviser to the Ministry of Textiles and Jute, Md. Sakhawat Hossain, told IPS that they are seriously considering funding the Sonali Bag project this January, although he acknowledged that his ministry is currently facing a funding crisis.

“The work will begin in full scale after the fund is provided,” Sakhawat Hossain said. When asked if Mubarak would receive the funds by January, he replied, “We hope so.”

A ban without adequate alternatives at hand

Mubarak Ahmed Khan regards the government’s decision to ban polythene bags as a “praiseworthy” initiative. However, he emphasized that sustainable and affordable alternatives to the polythene bags should come soon.

Mubarak is not alone in his concerns. Sharif Jamil, founder of Waterkeepers Bangladesh, an organization dedicated to protecting water bodies, shares skepticism about the effectiveness of the ban this time, citing the lack of sustainable alternatives in the market.

“The announcement of this ban is an important and timely step. However, it must also be noted that our previous ban was not enforced. Without addressing the underlying issues that led to nonenforcement of the previous ban, the new polythene ban will not resolve the existing problems. It is crucial to tackle the challenges that allowed polythene to remain in the market,” Sharif Jamil told IPS.

“If you don’t provide people with an alternative and simply remove polythene from the markets, the ban won’t be effective,” he added.

Sharif noted that the existing alternatives in the market are not affordable, with some selling alternative jute bags at Tk25 in supermarkets, while polythene bags are often offered at a price that is essentially free.

“Alternatives need to be more affordable and accessible to the public,” he said.

Mubarak stated that his Sonali bag currently costs Tk10 per piece, but he anticipates lowering the price with increased production and demand.

The pursuit of competition in sustainable alternatives

Sharif Jamil, however, wants competition in the sustainable alternatives market.

“It is not only about incentivizing Dr. Mubarak’s project,” Sharif said.

This technology has to be incentivized and recognized, but the government also has to ensure two other things, he said.

“If the government can make it accessible to people at a lower price, it will reach them. Secondly, if the alternative remains solely with Mubarak, it will create a monopoly again,” he said.

It must undergo competition, he recommended. Bangladesh has a competition commission to ensure that other existing sustainable green solutions on the market are also incentivized and recognized.

“Besides facilitating and upgrading Mubarak’s project, the government should ensure fair competition so that people can access it at a lower price,” he added.

For the sake of environment

Adviser Shakhawat Hossain said that they are optimistic about the success of Sonali Bag.

“Already the ambassadors of various countries are meeting me about this. Some buying houses too have been created for this. It seems it will be a sustainable development,” he said.

Mubarak said that if they get the funding soon, Sonali Bag will have a market not only in Bangladesh but all over the world.

He said the private investors should come forward not just because the government has banned polythene bags, but out of a moral obligation to address the negative impact these bags have on the environment.

“With this, I believe we can create a polythene-free environment,” Mubarak said, acknowledging, “It is not easy to introduce this to the market solely because it is a new product. We are up against an USD 3.5 trillion single-use plastic market.”

IPS UN Bureau Report

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Fair Tax Plan Could Prejudice Global South

Civil Society, Development & Aid, Economy & Trade, Featured, Global, Headlines, Inequity, TerraViva United Nations, Trade & Investment

Economy & Trade

Questions are asked whether the Organisation for Economic Co-operation and Development (OECD) agreement to force the world’s biggest companies to pay a fair share of tax will benefit the global South. Credit: Hugo Ramos/Unsplash

BRATISLAVA, Oct 20 2021 (IPS) – An agreement between 136 countries aimed at forcing the world’s biggest companies to pay a fair share of tax has been condemned by critics who say it will benefit richer states at the expense of the global South.


A deal agreed on October 8, and which covers around 90% of the global economy, includes plans for a global minimum corporate tax rate of 15%.

The Organisation for Economic Co-operation and Development (OECD), which led negotiations on the agreement, has said it will help end decades of countries undercutting each other on tax.

But independent organisations campaigning for fairer global taxes and financial transparency argue it will rob developing countries of revenues needed to recover from the COVID-19 pandemic, ultimately pushing millions more people into poverty.

Matti Kohonen of the Financial Transparency Coalition (FTC) civil society group told IPS: “In principle, a global minimum corporate tax is a good idea, but only if the rate is right and implemented properly. Under this deal, the main beneficiaries are the OECD – which led the negotiations – and its largest members.”

Calls for a global minimum corporate tax rate have grown in recent decades amid increasing scrutiny on the tax practices of multinationals.

The OECD deal, which has an aspirational implementation date of 2023, is designed to set a floor on corporate taxation and stop companies shifting profits to countries with the lowest tax rates they can find.

The OECD says the minimum global rate would see countries collect around USD150 billion in new revenues annually, and that taxing rights on more than USD125 billion of profit will be moved to countries where big multinationals earn their income.

But independent groups say the agreement falls far short of what is needed for a fair global corporate taxation system and has ignored the needs and wishes of developing nations, which rely more heavily on corporate tax than richer states.

According to OECD research Corporate Tax Statistics: Third Edition (oecd.org), in 2018, African countries raised 19% of overall revenue from corporate taxation as opposed to 10% among OECD states.

Critics point out that the 15% floor agreed to is well below the average corporate tax rate in industrialised countries of around 23%, potentially creating a ‘race to the bottom’ as countries cut their existing corporate rates.

It is thought a number of developing states had wanted a higher minimum global rate.

Civil society groups critical of the agreement also have concerns over many exemptions in the deal – there is a ten-year grace period for companies on some aspects of the agreement, and some industries such as extractives and financial services, are exempt.

Meanwhile, they highlight, only 100 of the world’s largest companies would be affected by part of the agreement aimed at getting highly profitable multinationals to pay more taxes in countries where they earn profits. Moreover, the minimum global tax will only apply to companies with a turnover of more than 750 million USD, which would exclude 85-90% of the world’s multinationals.

The fact that countries will have to waive digital services taxation rights, which are important sources of revenue for some developing states, is also problematic. And there are concerns that in many cases extra tax paid by corporations ‘topping up’ their tax bill to 15% will go to countries where they are headquartered. In many cases, this will be in already rich nations such as the US, UK, and Europe.

Chenai Mukumba of the Tax Justice Network Africa advocacy group told IPS: “We have an opportunity to reform the global tax system to make it right for global south countries, but we are settling for so much less. This is a lost opportunity to balance the scales, to put fairness at the centre of the system.”

The deal could have a negative effect on African countries, in particular, she pointed out.

Nigeria and Kenya have not signed up for the fair tax deal. Credit: Muhammadtaha Ibrahim Ma’aji/Unsplash

Kenya and Nigeria are among four countries that have not signed up for the deal.

“A lot of African countries currently have corporate tax rates of 25-30%. If the minimum rate is 15%, there is a great incentive for companies to shift profits elsewhere,” Mukumba said.

“Kenya hasn’t signed up to the deal because it is trying to raise revenue from its digital services taxation rights. It may end up buckling to the pressure [to join the deal],” she added.

OECD impact assessment studies for the deal published in 2020 https://www.oecd.org/tax/beps/economic-impact-assessment-webinar-presentation-october-2020.pdf showed that developing nations would gain as much as 4% extra corporate tax revenue.

The organisation told IPS this month (OCT) that it is now expecting those extra revenues to be even higher because of changes to the agreement since last year.

However, studies Pillar 1 impact assessment – 04.10.21 FINAL (oxfamireland.org) by the global aid group Oxfam estimate that 52 developing countries would receive around only 0.025 percent of their collective GDP in additional annual tax revenue under the redistribution of taxing rights.

The group also says a 25% global minimum corporate tax rate would raise nearly USD 17 billion more for the world’s 38 poorest countries – which are home to almost 39% of the global population – as compared to a 15 percent rate.

Speaking just after the agreement between the 136 countries was reached, Oxfam said in a press release that the deal was “a mockery of fairness that robs pandemic-ravaged developing countries of badly needed revenue for hospitals and teachers and better jobs”.

It added: “The world is experiencing the largest increase in poverty in decades and a massive explosion in inequality, but this deal will do little or nothing to halt either.”

Despite the criticism, OECD officials are adamant that the agreement will benefit developing nations.

They point out that it does not affect any state’s national corporate tax rates, and that the 10-year grace period only applies to a very small amount of income – 5% of the carrying value of a firm’s tangible assets and payrolls in a jurisdiction.

Grace Perez Navarro, Deputy Director of the OECD’s Centre for Tax Policy and Administration, told IPS: “The global minimum tax is aimed at stopping tax competition that is causing a race to the bottom in corporate tax rates.

“It does not require countries that have higher rates than 15% to lower their corporate tax rate, it just ensures that those countries will be able to collect at least 15%, no matter what type of creative tax planning a multinational comes up with.

“It will also reduce the incentive of multinationals to artificially shift their profits to low tax jurisdictions because they will still have to pay a minimum of 15%.”

She added: “It will also relieve the pressure on developing countries to offer excessive, often wasteful tax incentives while providing a carve-out for low-taxed activities that have real substance. This means that developing countries can still offer effective incentives that attract genuine, substantive foreign direct investment.”

But Mukumba said the problem is not that the deal will not bring any extra revenue to developing nations, but that richer nations will get much more out of it.

“Developing nations want a global corporate tax minimum, they have pushed for it in the past. They will get revenue under this deal, yes, but nowhere near as much as richer nations will get out of it,” she said.

This is problematic at a time when many developing nations are struggling with the effects of the COVID-19 pandemic and need revenue.

“This [deal] will mainly support recovery efforts in the G7 countries instead of developing countries which have been most impacted by the COVID-19 pandemic and are more in debt, preventing them from generating enough revenues to recover from the crisis and ultimately throwing millions more people into extreme poverty,” said Kohonen.

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